Thursday, June 28, 2007


Choppy session with the bulls in control for a long time though at the close it appears the bears are slipping into the drivers seat. The Dow and S&P 500 closed flat to slightly down while the Nasdaq finished up marginally. The Fed decision to leave rates the same was met with an initial surge which presented a great opportunity to fade the markets. Inflation is still an issue, rates are rising, liquidity is drying up, the Chinese are losing their appetite for US Govt. bonds and oil prices are moving up. In short, the bulls are running out of reasons to extend this rally.

Precious metal, distillers and airlines were the leading sectors today while oil, home construction and consumer electronics lagged. There were good moves in NTRI LVS OXPS OVTI GLD and SLV among stocks I own.

The race for finance- and tech-savvy quants has never been so ferocious, pitting investment banks, hedge funds and Silicon Valley darlings against one another in a wild, snarling, saber-toothed competition for warm, talented bodies. Google’s big edge? The California sunshine. Read Here
Capital Game: California hands down. NYC winters suck

Natural gas is falling… but is this just a calm before the hurricane season?
Natural gas has fallen back below $7 per Mcf, mostly on news that underground storage is safely 18% above the 5-year average. And, while this sounds like good news, it’s also important to remember that we’re just entering hurricane season. Continue reading
Capital Game: Get Long UNG

Yet another fund has bellied-up in the wake of the subprime fallout, following a revelation earlier this week that a London fund run by Cheyne Capital lost $91 million for similar reasons. Full Story
Capital Game: How many more blowups to go ?

Playboy Enterprises (PLA) is hoping that its luck is about to change in China. The media company has struggled for years to get a foothold in the country while at the same time combating trademark pirates who rip off the image of the Playboy bunny. But the House of Hefner until now has had little to show for its efforts in the world's largest country. That's not surprising, given the Chinese government's frequent anti-porn campaigns and its censorship of sex sites such as Read Here
Capital Game: Will Hugh Hefner be around to see the fruits of his labor ?

The volatile action in todays capital markets provides ample opportunities for profit, but keeping risk low is the greatest challenge. The last few weeks have produced some wild and at times violent swings and being long volatility has been the best bet.

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